Nicole-Anne Hickey v The Owners Strata Plan 78825

Relevant legislative provisions

1. The relevant definitions contained in the Encroachment Act are contained in s 2 as follows: Adjacent owner means the owner of land over which an encroachment extends. … Building means a substantial building of a permanent character and includes a wall. … Encroaching owner means the owner of land contiguous to the boundary beyond which an encroachment extends. Encroachment means encroachment by a building, and includes encroachment by overhang of any part as well as encroachment by intrusion of any part in or upon the soil. … Subject land means that part of the land over which an encroachment extends.
2. Sections 3 and 4 of the Encroachment Act relevantly provide: 3 Encroachments (1) Either an adjacent owner or an encroaching owner may apply to the Court for relief under this Act in respect of any encroachment. (2) On the application the Court may make such orders as it may deem just with respect to: (a) the payment of compensation to the adjacent owner, (b) the conveyance transfer or lease of the subject land to the encroaching owner, or the grant to the encroaching owner of any estate or interest therein or any easement right or privilege in relation thereto, (c) the removal of the encroachment. (3) The Court may grant or refuse the relief or any part thereof as it deems proper in the circumstances of the case, and in the exercise of this discretion may consider amongst other matters: (a) the fact that the application is made by the adjacent owner or by the encroaching owner, as the case may be, (b) the situation and value of the subject land, and the nature and extent of the encroachment, (c) the character of the encroaching building, and the purposes for which it may be used, (d) the loss and damage which has been or will be incurred by the adjacent owner, (e) the loss and damage which would be incurred by the encroaching owner if the encroaching owner were required to remove the encroachment, (f) the circumstances in which the encroachment was made. (4) The Court may refer any question involved in proceedings on the application to: (a) any registered land surveyor (within the meaning of the Surveying and Spatial Information Act 2002), or (b) any valuer. (5) This section applies to encroachments made either before or after the commencement of this Act. 4 Compensation (1) The minimum compensation to be paid to the adjacent owner in respect of any conveyance, transfer, lease, or grant to the encroaching owner shall, if the encroaching owner satisfies the Court that the encroachment was not intentional and did not arise from negligence, be the land value of the subject land, and in any other case three times such land value. (2) In determining whether the compensation shall exceed the minimum, and if so by what amount, the Court shall have regard to: (a) the value, whether improved or unimproved, of the subject land to the adjacent owner, (b) the loss and damage which has been or will be incurred by the adjacent owner through the encroachment and through the orders proposed to be made in favour of the encroaching owner, (c) the circumstances in which the encroachment was made.

Issues for determination

1. By the conclusion of the hearing the issues that remained for determination in the agreed list of issues filed were as follows: 1. Whether the Applicants or the Respondent are an "Encroaching Owner" under ss 2 and 3 of the Encroachment Act; 2. The purpose of the Gabion Wall pursuant to s 3(3)(c) of the Encroachment Act; 3. Whether the Court should grant an easement for the Gabion Wall, and the terms of that easement; 4. Whether the Court should award compensation under s 3(2)(a) of the Encroachment Act; 5. If the Court should award compensation, what quantum of compensation should be awarded; and 6. The entitlement of the parties to costs.
2. It was agreed that issue (1) was preliminary in the sense that if the Applicants were the "Encroaching Owner" and not an "Adjacent Owner" for the purposes of the Encroachment Act the proceedings should be dismissed and there was no need to proceed to answer the remaining issues (apart from costs of the proceedings) as such issues related to the appropriate relief and the exercise of the Court's discretion. Accordingly, it is appropriate that the first issue be determined first as it dictates the entitlement to the relief sought in the Application.

Are the Applicants an Encroaching Owner or an Adjacent Owner for the purposes of the Encroachment Act?

Evidence

1. The nature and extent of the Gabion Wall as it related to the Applicants' and the Respondent's land was identified in the survey prepared by Bee & Lethbridge dated 8 July 2020 (Exhibit D at folio 161) which is Annexure A hereto.
2. The Survey demonstrates that the Gabion Wall is situated predominately within Lot 2 DP 24705, which lot is the Applicants' Land and crosses the boundary at the north-western corner of that lot such that the base of the Gabion Wall is located to a maximum extent of 0.15m within SP 78825 being the Respondent's Land. It was agreed between the parties that the area of the Gabion Wall situated on the Applicants' Land in plan was of 16m2 and the area on the Respondent's Land in plan was in the order of 0.4125 m2.
3. The Second Mod Landscape Plan referred to at point 4.13 in [3] above indicated that a Gabion Wall was proposed to be constructed as part of the development of the buildings situated upon the Respondent's land. The Second Mod Landscape Plan indicated that where located near the boundary between the Applicants' and the Respondent's land, such Gabion Wall was proposed to be constructed wholly within the Applicants' Land. There was no evidence that the Applicants gave the necessary consent as owners of the land to the carrying out of this development on their land as would have been required pursuant to cl 115(1)(h) of the Environmental Planning and Assessment Regulation 2000 (NSW) as was in force at the relevant time. The Second Modification was granted for the works that included the works the subject of the Second Mod Landscape Plan and the Gabion Wall was constructed.
4. There is no evidence as to whether at the time of construction the Gabion Wall was wholly contained on the Applicants' Land.

Applicants' submissions

1. The Gabion Wall being a retaining wall is a building under which the Encroachment Act can apply subject to satisfaction of the other elements of the legislation.
2. An encroachment is defined in s 2 of the Encroachment Act as including "encroachment by overhang of any part" or "by intrusion of any part in or upon the soil". The High Court in Amatek Limited v Googoorewon Pty Limited (1993) 176 CLR 471 (Amatek) held that the encroachment by a building of which the Encroachment Act speaks is a horizontal encroachment "beyond the boundary" between the land of the encroaching owner and the land of the adjoining owner. Thus an "encroachment" under the Encroachment Act is an encroachment by a building that traverses the "boundary" between contiguous parcels of land: Amatek at 478. In this case, it is clear that the Gabion Wall traverses across the boundary between the Applicants' and the Respondent's land.
3. In Amatek the High Court in considering the relevant definitions in s 2 said, at 475: As a matter of ordinary language, "encroachment" is a term appropriate to describe either the action of a person who intrudes upon land or rights to which he has no title or the intrusion by some inanimate thing on an area broader than the area properly or previously occupied by it.
4. There was then discussion as to the previous Court of Appeal consideration of whether the Encroachment Act can apply to structures erected wholly on neighbouring land. After that, the High Court said, at 477: The purpose of the Act is to be ascertained from its language. So far as one may define the purpose of the Act from its long title, that purpose does not extend to the conferring of a general power to change the boundaries between contiguous parcels of land. It is an Act "to make provision for the adjustment of boundaries where buildings encroach on adjoining land; to facilitate the determination of boundaries; and for purposes connected therewith". The twin purposes of the Act are to facilitate the determination of existing boundaries (provided for by s.9) and to permit the adjustment of boundaries when, but only when, buildings encroach on adjoining land (provided for by s.3). The language of the Act shows clearly that the encroachment to which it relates is not an encroachment by a person but an encroachment by a building: the definition of "encroachment" in s.2 explicitly says so. The term is defined by extension to include "encroachment by overhang of any part" or "by intrusion of any part in or upon the soil". By the definition of "subject land", the land of the "adjacent owner" which the court may order to be conveyed, transferred or leased to the encroaching owner pursuant to s.3(2)(b) is only "that part of the (adjacent owner's) land over which an encroachment extends". The subject land is thus identified as the land vertically under the encroachment. And in s.9, which authorizes an application to the court by either of the owners of contiguous parcels of land to determine the true boundary between their parcels, the jurisdiction is limited to cases where a question arises "whether an existing building encroaches or a proposed building will encroach beyond the boundary".
5. Here, there is both an "Encroaching Owner" being "the owner of land contiguous to the boundary beyond which an encroachment extends" and an "Adjacent Owner" being "the owner of land over which an encroachment extends". The Gabion Wall occupies both sides of the boundary, and the Applicants can be considered the "Adjacent Owner" and the Respondent the "Encroaching Owner".
6. The Applicants do not own the Gabion Wall. It was not constructed by them or with their consent. It is not relevant that the Respondent did not construct the Gabion Wall. In determining the identity of the Adjacent Owner and the Encroaching Owner it is necessary to consider the purpose for which the building was constructed and for whose benefit the building was constructed - who owns it. Once the person for whose benefit the building was constructed and who constructed it is identified that person is the Encroaching Owner.
7. In this case, the Respondent did not exist at the time the original developer was carrying out the works. The Encroachment Act does not seek to delineate between the doers of the relevant action and the owners of the land. The statutory liability is reflected by the words used in the provision and the definitions, that is, it applies to persons who are present owners of the land.
8. It should not be controversial that the Encroachment Act facilitates the resolution of recent as well as historical encroachments, with such resolution to be determined having regard to the relevant owners of the parcels of land to which the encroachment relates: see s 3(5) which provides that the Encroachment Act applies to encroachments either before or after the commencement of the Encroachment Act.
9. Relief is available to the Applicants against adjoining owners even if those owners may not have had direct involvement with the creation of an encroaching structure or have inherited, through acquisition, the encroaching structure. In this case, upon incorporation of the owners corporation, it inherited the Gabion Wall which the prior owner erected/constructed upon and over the Applicants' land.
10. In Keith James Wherry v Trustees of the Sisters of Charity of Australia (2000) 111 LGERA 216 (Wherry) Bignold J looked at cases dealing with the pattern of land ownership, where later subdivisions have caused certain buildings to become encroachments, rather than an act of building across a boundary. From [20]-[24] his Honour said: 20 The case has been conducted on the commonly accepted basis that there is relevantly (for the purposes of the Act) an "encroachment" even though when the school building from which the encroachment derives) came into existence in 1966, there was not relevantly an "encroaching owner" and an "adjacent owner" (because of the Respondent's unity of title in respect of both parcels of land) although they came into existence on 14 September 1998 when the Applicant completed his purchase of the Residential Property. Despite any logical difficulty that may be thought to be presented by the foregoing facts, I am prepared to adopt the parties' common approach that there relevantly exists an "encroachment". This approach is supported by the decisions of Bryson J in Boed Pty Ltd v Seymour (1989) 15 NSWLR 715 and of Stein J in Droga v Proprietors of Strata Plan No 51722 (1996) 93 LGERA 120 where both decisions focus on the existence of the facts (crucial to the operation of the Act) at the time the application under the Act is before the Court. 21 Thus, in Boed, the Court rejected the argument that to be an "encroachment" under the Act "the original act of construction must either be carelessly or deliberately an unauthorised or trespassory intrusion against the right of the person affected by the act of constructing it" (717), Bryson J, holding at (719): "In my view the word "encroachment" in the Encroachment of Buildings Act takes the situation which exists at the time of making an application. The definition in s 2, which is not a particularly enlightening passage, says, "Encroachment means encroachment by a building", and goes on to include some other matters. The concept has to be accepted of encroachment of a building, not encroachment by a person. Plainly the general law concepts of trespass are not incorporated because, of course, under the general law only people can commit acts of trespass and encroach on other people's land. The concept has to be accepted of a building as an entire thing which can encroach beyond the boundary line, a concept which is rather alien to earlier thinking expressed for example in Billiet's case… and the use of that concept marks this as reforming legislation which should be given a construction which renders it effective to deal with earlier deficiencies in the law." 22 In Droga, the Court was dealing with a case of two buildings which were respectively erected on adjacent lands in 1917 and 1927 (in such a manner that one building encroached upon the other) at times when the lands upon which the buildings were erected were owned by the same person. The two properties remained in common ownership until 1994 when a plan of subdivision of the two properties was registered as a deposited plan, and the properties were sold to different purchasers. 23 Stein J, in rejecting the submission that there was no relevant encroachment under the Act said (at 123): "Until late 1994 there was no encroachment, as the properties were owned by the one owner with the wall into which the beams intruded functioning as a party wall between the buildings. The encroachment only arose as a result of the surveyor's error. It was an unintentional error, but was perpetuated into the deposited plan." 24 It is not entirely clear from the judgment in Droga whether the two separate buildings were erected upon separate parcels of land or upon a single parcel. At all events a relevant "encroachment " was held to have come into existence only when the survey plan prepared for the purpose of subdividing the land(s) (incorrectly but unintentionally) noted the existence of separate walls of each of the buildings, adjacent to the common boundary, when in fact there was only a single party wall entirely located on one of the subdivided lots and into which intruded the cross beams of the adjacent building, such intrusion (at a number of different floor levels) constituting the relevant "encroachment ".
11. This case does not relate to acts of subdivision which create encroachments, rather, it relates to the liability under this legislation of successors in title. To the extent that point is not subsumed by the analysis in the caselaw set out above (given the obvious changes in ownership which occur post-subdivision) it is simply evident by the statutory language itself. It applies to owners of land and is to be assessed at the time of the application. That is exactly the point made in the extract at [20] of Wherry referring to Bryson J in Boed Pty Ltd v Seymour (1989) 15 NSWLR 715 and Stein J in Droga v Proprietors of Strata Plan 51722 (1996) 93 LGERA 120 which Bignold J said, "both decisions focus on the existence of the facts (crucial to the operation of the Act) at the time the application under the Act is before the Court".
12. The Gabion Wall is partially on the Respondent's land and partially on the Applicants' land. A predecessor of the Respondent constructed the Gabion Wall as part of the development of the Respondent's land for the benefit of that land and its development. The Gabion Wall was constructed for the benefit of the Respondent's land, enabling it to retain the slope on the Applicants' land following excavation of that slope so that 118B could construct its driveway, it was a cheap and easy retaining solution, it provided improved visual amenity to the Respondent's land and it enabled the developer to utilise excavated sandstone rock in the gabion baskets and to dispose of fill behind the Gabion Wall as it was constructed, both of which came from the Respondent's land. The Gabion Wall was constructed predominantly on the Applicants' land without their knowledge or consent.
13. To the extent that the Respondent relies upon the decision of the Supreme Court in Cantamessa v Sanderson (1993) 6 BPR 13,127 (Cantamessa), cited in Byron Council v Vaughan & Anor [1998] NSWLEC 158 (Byron Council v Vaughan), in support of the proposition that because only a sliver of the Gabion Wall is on the Respondent's land it cannot be the Encroaching Owner the Court would not accept that submission. The Court of Appeal in Vaughan v Byron Shire Council (1999) 103 LGERA 321 (Vaughan v Byron Shire Council) did not endorse that approach. In that case, the Vaughans submitted that because 60-65% of the house was on their lot and 35-40% was on the Council's lot there was no "encroachment" because "too much" of the house was on Council's lot. The Court of Appeal rejected that submission and said at [38]: There is no suggestion that the Act is concerned with such subtle and imprecise distinctions in the decision of the High Court in Amatek…
14. At [39] the Court of Appeal went on to say that it was unnecessary for it to decide: …whether there might be circumstances in which so much of a building is located on an adjoining property owned by another person that the owner of the former block who built or purchase the house cannot be described as an "encroaching owner" and the owner of the latter block as an "adjacent owner" or the building as an "encroachment". That is not this case.
15. The Court of Appeal did not endorse the approach taken in Cantamessa, relied upon by the Respondent. In any event, Cantamessa is a very different case factually and would be distinguished.
16. It would be an absurd result if a building could be constructed with the majority of the building encroaching over the neighbouring land (without the owner's knowledge or consent), and the Court being denied jurisdiction to grant relief on the basis that the neighbouring landowner is the encroaching owner. Such a construction of the meaning of "encroachment" and "encroaching owner" would undermine the purpose of the Encroachment Act to regularise land and boundary irregularities, and the remedial powers under the Encroachment Act including, relevantly, to grant to the encroaching owner an easement and to order payment of compensation in respect of that easement to the adjacent owner.
17. Accordingly, it is readily able to be concluded that the Encroachment Act applies, the Applicants are the relevant Adjacent Owner, and the Court has jurisdiction to grant the relief sought by the Applicants.

Respondent's submissions

1. It is well established that the owner is the owner of the relevant land at the time of the application to the Court: Wherry at [20] per Bignold J.
2. The parties agree that the Gabion Wall is located toward the rear of the Applicants' land and comprises an area of 16m2. The Gabion Wall traverses the southeast boundary of the Applicants' land into the Respondent's land in a triangular shape having an area of approximately 0.4125m2. Accordingly, 2.575% of the Gabion Wall occupies the Respondent's land and 97.425% of the Gabion Wall is on the Applicants' land.
3. In Cantamessa Powell J considered the proper characterisation of parties as "encroaching owners" and "adjacent owners" in the context of the Encroachment Act. In that case, the facts were not dissimilar to those in these proceedings where a wall and planter box traversed a boundary, and the bulk of the building was located on one lot. In Cantamessa, two thirds of the building was located on one lot and one third located on the other. Powell J held at 13,130: It further follows, so it seems to me, that, even if the wall and planter-box were to be considered as a single building, by reason of the fact that by far the greater part of the bulk of the building was located on lot 5, that building encroached, not from lot 4 onto lot 5 - a classic case of the tail wagging the dog - but from lot 5 onto lot 4, the consequence being that, even on this hypothesis, Ms Cantamessa did not qualify as an "encroaching owner" in respect of it. The same process of reasoning, so it seems to me, would lead one to conclude that, even if the wall and planter-box were to be treated as two separate buildings, the planter-box - two-thirds of which stood on lot 5 - encroached, not from lot 4 onto lot 5, but from lot 5 onto lot 4, so that, even in respect of it, Ms Cantamessa did not qualify as an "encroaching owner".
4. This extract was cited by Lloyd J in Byron Council v Vaughan who went on to observe as follows at [14]-[15]: 14 It is to be noted that Powell J in the case of a structure which was one-third on the plaintiffs land and two-thirds on the defendants land, expresses the view that the building encroached from the latters land onto the formers land. That was what disqualified the plaintiff from being an "encroaching owner" in that case. Powell J does not say, however, that the defendant is disqualified from being an "encroaching owner" in that case. The fact that the encroachment by the structure was relevantly one-third as against two-thirds does not seem to have inclined Powell J to the view that the structure did not encroach from the defendants land onto the plaintiffs land. I am left with the impression that if two thirds of the structure had been on the plaintiffs land then Powell J would have found that the plaintiff was an "encroaching owner" in that case. 15 In the present case the building straddles the boundary so that about 35-40 per cent of it is on the applicants land and about 60-65 per cent of it is on the respondents land. It seems to me that if the substantial part of the building is on the respondents land then that makes the respondent an "encroaching owner"; if a lesser part of the building is on the applicants land then that makes the applicant an "adjacent owner"; and that part of the building which is upon the applicants land is an "encroachment" within the meaning of the Act.
5. These observations were not disturbed by the Court of Appeal in Vaughan v Byron Shire Council. Relevantly, Fitzgerald JA made the following observations at [39]: 39 The Vaughans sought to bolster their primary argument by pointing out that the statutory concept of "encroachment" is associated with the other statutory concepts of "encroaching owner" and "adjacent owner", which are also defined in s2 of the Act. It is unnecessary for the decision of the present case to decide whether there might be circumstances in which so much of a building is located on an adjoining property owned by another person that the owner of the former block who built or purchased the house cannot be described as an "encroaching owner" and the owner of the latter block as an "adjacent owner" or the building as an "encroachment". That is not this case. There is no doubt that the Vaughans paid for the house, which had been mistakenly erected straddling the boundary by the predecessor in title from whom they purchased their land, or that the house which the Land and Environment Court held was an "encroachment", correctly in my view, would have been fully and solely owned by the Vaughans but for such rights as inhere in the council by virtue of its partial construction on the council's land. Subject to the Vaughan's estoppel contention. The Act is concerned with the adjustment of rights in such circumstances, except perhaps in exceptional cases with which this Court is not presently concerned.
6. The Applicants' submissions where they contend that the "the Court of Appeal in Vaughan v Byron Shire Council [1999] NSWCA 235 did not endorse" the approach in Cantamessa are misplaced for a number of reasons. First, the Court of Appeal did not consider Cantamessa at all. Second, and more importantly, the Court of Appeal did not decide whether there might be circumstances in which so much of a building is located on an adjoining property owned by another person that the owner of the former block who built or purchased the house cannot be described as an "encroaching owner" and the owner of the latter block as an "adjacent owner" (at [39]). Third, the outcome of the Court of Appeal decision turned on whether or not an encroachment existed and there is no such dispute in this appeal. Fourth, contrary to the Applicants' submission, the facts in Cantamessa are quite similar to the present situation.
7. In circumstances where 97.425% of the Gabion Wall is located on the Applicants' land, the Applicants are properly considered the "Encroaching Owner" and the Respondent the "Adjacent Owner" because the Gabion Wall is predominantly located on the Applicants' land with only a small sliver of the Gabion Wall located on the Respondent's land. As such, the Gabion Wall is owned by the Applicants which extends, in part, onto the Respondent's land, being the "wagging tail of the dog". In those circumstances, the Respondent is disqualified from being an "Encroaching Owner".
8. The proposition that the Respondent is not an Encroaching Owner is supported by the reasoning of the High Court in Amatek at 477-8 where the encroachment is the building extending "beyond the boundary".
9. If the Court were to accept the Applicants' submission that, in effect, an Encroaching Owner is the person that asserts the encroachment it would create an absurdity in the construction of the Encroachment Act. If one is to treat the encroachment as an intention rather than the extension of an inanimate object, there would be a race to the Court to seek relief as it would be to treat the "first in" as "best served" as the encroaching Owner.
10. If, contrary to the High Court's treatment in Amatek that the encroachment is the extension of the building rather than the purpose of the building, the "ownership" of the building was to be determined by the intention of the builder would be to ignore the legal maxim "he who owns the soils owns everything above (and below) from heaven (to hell)".
11. The Court has no jurisdiction in relation to the dispute and the proceedings must, therefore, be dismissed.

Findings

1. It is necessary for me to determine this issue having regard to the state of the encroachment at the time of the hearing. The evidence is accepted that the Gabion Wall crosses the common boundary between the Applicants' and the Respondent's land and it is, therefore, an encroachment for the purposes of the Encroachment Act.
2. The question that arises, however, is which of the parties is relevantly defined by the Encroachment Act as the Encroaching Owner and which the Adjacent Owner. Whilst proceedings under the Encroachment Act may be brought by either the Adjacent or Encroaching Owner, as provided in s 3(1), the significance of the question in the context of these proceedings relates to the relief sought in the proceedings. The Applicants have limited the relief they seek to the grant of an easement for the retention of the Gabion Wall on their land together with an obligation upon the Respondent to maintain and repair the Gabion Wall pursuant to s 3(2)(b) of the Encroachment Act and an order for the payment of compensation pursuant to s 4(1) of the Encroachment Act. Each of these remedies would only be available if the Applicants were held to be the Adjacent Owner. If the Applicants were held to be the Encroaching Owner, the Court would have no power under the Encroachment Act to make the orders sought.
3. The relevant question to be derived from the legislative provisions and in particular the definitions in the Encroachment Act of: Adjacent Owner; Encroaching Owner; and Subject Land, can be distilled as: where is the building primarily located and where does it extend from that primary location? I formulate the question in that fashion as each of the relevant definitions requires an ascertainment of the identification of the land "over which" or "beyond which" an "encroachment extends".
4. The term "extends" is not defined in the Encroachment Act and is therefore to be given its ordinary meaning having regard to the statutory context in which it is found. From the statutory language it can be seen that the term "extends" is used in this statutory context in its verb form. Whilst dictionary definitions are not a substitute for ascertaining the meaning they are of assistance in determining the ordinary meaning and usage of a word: House of Peace Pty Ltd and another v Bankstown City Council (2000) 48 NSWLR 498 at [25]-[30]. As was recently observed by Basten JA in Weston Aluminium Pty Ltd v Environmental Protection Authority [2022] NSWCA 236 at [32]-[33]: … because a term is undefined in a statute or regulation, it does not follow that it has the same usage as in ordinary speech. Indeed, the meaning intended in ordinary speech can only be identified by reference to its use in a particular sentence, in a particular context. The present context is a legal document, namely a regulation made under an Act of Parliament. How it is used in that instrument must depend on a careful analysis of the surrounding text and context. …as this Court has warned on many occasions, reference to dictionaries to determine the meaning of statutory language can only assist in identifying the range of possible meanings. To determine the actual meaning, it is necessary to return to the context, and particularly the text of the statute. Indeed, dictionaries demonstrate that the term "dispose of" has more than one meaning, so that choice will be arbitrary unless the word is construed in its statutory context.
5. With such cautions in mind, the Macquarie Dictionary (online) defines "extend" as a verb to mean: -verb (i) 13. to be or become extended; stretch out; to be continued in length or duration, or in various or all directions. 14. to reach, as to a particular point. 15. to increase in length, area, scope, etc.
6. This dictionary definition is consistent with the statutory language which indicates that the building has a primary location being the location and from that location it has a secondary location being the area across the lot boundary from the primary location. The determination of the primary location will determine which owner is the Encroaching Owner as it is from that land that the building will extend.
7. If it were intended that the determination of the character of Encroaching Owner and Adjacent Owner was not to be influenced by the primary location of the building there would be no need to refer to the buildings extending "beyond" a boundary, all that would be required would be a reference to any part of a building being across a boundary.
8. Further, there is nothing in the statutory language of the defined terms that would indicate that a consideration of the intention in the construction of the building, or the cause of the encroachment would be relevant. This construction is consistent with that which was held in Amatek at 477 that: The language of the Act shows clearly that the encroachment to which it relates is not an encroachment by a person but an encroachment by a building: the definition of "encroachment" in s. 2 explicitly says so…
9. To that extent, the subjective circumstances that gave rise to the erection of the Gabion Wall which is now said to encroach or the reason for or the "fault" that caused the encroachment, at this stage of the application of the definitions (albeit it may arise if an enquiry under s 3 is warranted), is not relevant to the determination of the question of: over which land does the encroachment "extend"?
10. For those reasons, having regard to the statutory language the Applicants' contention that they do not "own" the Gabion Wall or that it was constructed without their knowledge or consent has no part to play in a determination of which party is to be described as either the "Adjacent Owner" or the "Encroaching Owner".
11. With respect to the Applicants' submissions at [27] above that a construction such as that outlined above would undermine the purposes of the Encroachment Act or cause an absurdity cannot be accepted. If it was intended that either party could make an application for orders for easements and compensation the Encroachment Act would not have been drafted to afford that remedy to only one of the defined parties. There must be some statutory purpose to be given to the clear words of limitation on the remedies available. To the extent that some legislative purpose can be derived from the long title to the Encroachment Act it is to make provision in certain nominated circumstances. Those circumstances require an objective (as opposed to subjective) assessment of where a building (not a person) encroaches and make provision for remedies where those circumstances fall within the remedial scheme provided for in the Encroachment Act. To construe the Encroachment Act according to its words, to the extent that it is said by the Applicants to cause them some injustice, that is merely a reflection of the fact that the Encroachment Act was not intended to apply to the Applicants' circumstances in the manner in which they contend.
12. Applying that construction to the facts of the present case I find that the Applicants are the Encroaching Owner as the overwhelming majority of the building (being the Gabion Wall) is present on their land and to that extent the Applicants' land is where the building is primarily located. There is a minor extent to which the Gabion Wall crossed the common boundary into the Respondent's Land. On the basis of those facts, which were not disputed, on a proper construction of the relevant provisions of the Encroachment Act to the facts of this case the irresistible conclusion is that the Applicants are the Encroaching Owner. To find otherwise could only be justified if the impermissible factors such as cause or intention that gave rise to the encroachment were taken into account. Accordingly, I find that the Applicants are the Encroaching Owner for the purposes of the Encroachment Act.
13. Whilst I have been taken to a number of authorities by the parties in this matter, in the first instance, I have approached the exercise of statutory construction independent of those authorities. However, having undertaken that task the findings I made are consistent generally with the principles outlined in the authorities that largely turned on their own facts. That being said, the Court of Appeal in Vaughan v Byron Shire Council at [39] observed: …It is unnecessary for the decision of the present case to decide whether there might be circumstances in which so much of a building is located on an adjoining property owned by another person that the owner of the former block who built or purchased the house cannot be described as an "encroaching owner" and the owner of the latter block as an "adjacent owner" or the building as an "encroachment". That is not this case.
14. The circumstances of this case do give rise to a consideration of this issue. Not only is the extent of the differential spatial occupation of the building on each side of the boundary significant but so too are the facts relating to the construction of the Gabion Wall. If the circumstances surrounding the construction are relevant (as referred to in Vaughan v Byron Shire Council which for the reasons I outline above, I do not consider such factors relevant), this case also reveals that the Gabion Wall was constructed on the Applicants' Land in the location shown on the plans indicating its intended location. Whilst not lawfully entitled to so construct the Gabion Wall in that location it was not mistakenly, or through changing boundary lines, located in a place that was not intended.
15. With the Applicants properly identified as the Encroaching Owner within the meaning of the Encroachment Act, the relief claimed by the Applicants is not available to them and the Court has no power to make the orders sought. For that reason, the proceedings must be dismissed.

Discretion to make orders in respect of the encroachments: s 3(3).

1. The parties adduced considerable evidence as to the exercise of the discretion in s 3 in the event the Court found the Applicants were entitled to the orders sought in the Application. Whilst not arising in light of my findings, in the event that I am in error in my construction of the relevant provisions of the Encroachment Act and the finding that the Applicants are an Encroaching Owner it is appropriate that I express my reasons as to why I would have declined to grant the relief sought in this case in the exercise of the discretion in s 3.

Evidence

1. The Applicants' evidence was adduced by way of affidavit from: 1. Nicole-Anne Hickey - the First Applicant; 2. Glenn Hickey - the Second Applicant; 3. Christine Wadsworth - a former adjoining neighbour; 4. Terry Harvey - hydraulic engineer; 5. David Hunter - geotechnical engineer; 6. Anthony Alford - valuer; and 7. Richard Weber - civil engineer, prepared by the Respondent but read on behalf of the Applicants.
2. The Respondent's evidence was adduced by way of affidavit from: 1. Deidhre Wauchop - Respondent's representative; 2. John Braybrooke - geotechnical engineer; 3. Ralph Erni - hydraulic engineer; and 4. Terry Davis - valuer.
3. The evidence adduced related in large part to the purpose for which the Gabion Wall it could be deduced was intended to serve and the circumstances surrounding the construction of the Gabion Wall, being factors relevant to the exercise of the discretion in s 3 of the Encroachment Act. To the extent that either party considered the evidence relevant each of the parties referred to the evidence in their submissions which are summarised below.

Applicants' submissions

1. The Gabion Wall was not constructed by the Applicants, nor was it constructed with their knowledge or consent. Mr and Mrs Hickey were owner builders and attended the site infrequently. The Gabion Wall was at the lower level of their land and distant from the dwelling being constructed. They were unaware that there was work being undertaken on their land. The Gabion Wall was not constructed to serve any of their purposes.
2. The Gabion Wall was constructed for reasons which benefit the Respondent and the developers of that land. As was made apparent in the evidence of the developer's project engineer, Mr Weber, which evidence was not challenged in cross-examination: 1. He was the project engineer for the development of the Respondent's land; 2. There were a number of options available to the developer to address the boundary with the Applicants' land, one of which included leaving the lantana covered slope untouched; 3. There was no excavated face to retain on the boundary line (in other words the land sloped down to the boundary and was not in need of retention); 4. Another option involved construction of a retaining wall of some description; 5. The project had an excess quantity of excavated sandstone rock; and 6. The Gabion Wall option allowed excavated sandstone rock to be placed in the baskets and some of the excess excavated material to be placed behind the retaining wall.
3. Those assertions are consistent with the opinions expressed by the Applicants' experts with respect to the manner in which the Gabion Wall appears to have been constructed.
4. The further benefit to the Respondent was explained in the expert report of Mr Braybrooke who confirmed that the proposed excavation for the access driveway typically had a 1m setback to the upslope property boundaries and that Douglas Partners (referring to their 2002 report and 2003 supplementary report) recommended that the soil and weathered rock profile in the slope be supported by an engineering designed retaining wall, with the additional benefit that the Gabion Wall was constructed in its location so as to ensure that the garages of the westernmost townhouses on the Respondent's land complied with the swept paths prescribed by AS2890.
5. It is therefore clear from the evidence that the Gabion Wall was constructed to benefit the Respondent's land. It would be beyond absurd to think that the works were carried out to benefit neighbours who were not consulted, did not know, and had their property used for the benefit of another. This is especially so when there was already a structurally sound, much smaller log retaining wall approximately 1 metre high, significantly cheaper to maintain and/or replace, and where the Applicants were given absolutely no choice in the matter by the developer.

Respondent's submissions

1. The following evidence is relevant to the Court's consideration under s 3 of the Encroachment Act.
2. The Gabion Wall provides agreed material benefits to the Applicants: 1. As a retaining wall for backfill and soils located on the Applicants' Land above the natural rock shelf that "cuts across" the Applicants' land; and 2. By providing amenity to the Applicants by levelling the rear yard in lieu of an "over steepened slope".
3. The Applicants rely upon evidence that fill was placed behind the Gabion Wall by the developer of the Respondent's land. This Court does not have any jurisdiction in relation to the placement of the fill as it is not a "building" for the purposes of the Encroachment Act. Accordingly, in addition to the amenity benefits to the Applicants, they require the retention of the Gabion Wall to retain the fill to discharge their duty to take reasonable steps to prevent or minimise the risk of injury or damage to the Respondent's land that may occur if the fill is not adequately retained.
4. The benefits of the Gabion Wall to the Applicants far outweigh the agreed benefit of the reduction in risk of landslip to the Respondent.
5. The construction of the Gabion Wall commenced between 5 September and mid-October 2005 and was largely completed between 24 October 2005 and early December 2005, some 17 years ago.
6. The Applicants seek to remedy a situation where they say that the Gabion Wall was constructed on their land without their consent, prior to the existence of the Respondent, but purportedly by the developer of the Respondent's land in accordance with a development consent issued by Warringah Shire Council (the Council) on 14 September 2004 (the Development Consent).
7. In the 17 years since the construction of the Gabion Wall, there is no evidence that the Applicants have: 1. Challenged the validity of the Development Consent (including its modifications); or 2. Prosecuted any claim for trespass or damages against the entity that constructed the Gabion Wall.
8. The valuation report dated 20 August 2020 prepared by Meadow Real Estate Pty Ltd assessed the land value of the part of 154 Parkes affected by the Gabion Wall in the amount of $27,250. This valuation was based on a rate per square metre of $1,650. Mr Davis' evidence is that the difference in valuation is due primarily to the buoyant residential market that has emerged since 2020.
9. As a matter of discretion, the Court would take into account the extreme delay by the Applicants in bringing this application and the market movement in the land (noting that the Applicants purchased the land for $550,000 in 2003).
10. When regard is had to s 3(3) of the Encroachment Act, the Respondent submits that the Court would refuse to grant the relief sought by the Applicants as: 1. The Gabion Wall (as well as the timber fence) was constructed by the developer and the Applicants have failed to join the developer as a party to the proceedings despite having ample time and opportunity; 2. The Gabion Wall is predominantly located on the Applicants' land with only a small sliver of the Wall on the Respondent's land; 3. The Respondent does not use the Gabion Wall however, it accepts that the Gabion Wall does mitigate the risk of slope instability arising from the topography of the Applicants' land which should be tempered against the responsibility that the Applicants have not to cause any instability that would impact on the Respondent; 4. The Applicants benefit from the Gabion Wall because it retains the fill and soil behind the Wall and provides backyard amenity (which may be lost if the Gabion Wall were to be removed); 5. Having regard to the following matters, the Applicants were aware or should have been aware that the Gabion Wall was constructed on 154 Parkes (and 152 Parkes Road) and, in fact, consented to such construction: 1. Prior to obtaining an occupation certificate for the Hickey Works, the Applicants obtained a works-as-executed sketch survey of 154 Parkes. The cover letter from the surveyor indicated that "Other than irregularities in fencing there are no other apparent encroachments by or upon the subject land, as shown upon the sketch". However, the survey plan showed the timber fence at the rear of 154 Parkes as being between 1.1-1.35m clear of the boundary with 118B Parkes. The Respondent says that plainly this put the Applicants on notice that the timber fence was not on the boundary of 154 Parkes and the Applicants were aware that the Gabion Wall was erected between that fence and the boundary. As such, the Applicants were aware of the encroachment since at least August 2007; 2. The uncontested evidence of Mr Weber, who was the civil engineer for the works associated with the 118B Consent and, more specifically, the Gabion Wall, that there was agreement with the Applicants (and the owners of 152 Parkes) for the construction of the Gabion Wall on 154 Parkes (and 152 Parkes) at no cost to the Applicants. Although the Applicants read the Affidavit of Mr Weber and had an opportunity to examine or re-examine the witness, they elected not to do so. In the circumstances, the Court would accept Mr Weber's evidence; and 3. One of the then owners of 152 Parkes, Ms Christine Wadsworth, gave oral evidence that she saw the construction of the Gabion Wall and associated importation of fill onto 152 Parkes and, consequently, may be taken to have consented to these undertakings on her land. Ms Wadsworth accepted that it was also possible that her then partner may have given his agreement to the developer constructing that part of the Gabion Wall on their land. 1. If the Applicants were not aware, then the Applicants ought to have been reasonably aware that the encroachment existed or were otherwise wilfully blind to its existence for the reasons that follow: 1. The Applicants were aware of the slope of 154 Parkes and that the slope finished at the southern boundary of 154 Parkes; 2. The Applicants were aware of the existence of a log wall on 154 Parkes towards the southern boundary of that road as shown on the sketch plan annexed to the Crosier Report; being an investigation report to support the Applicants stormwater design; 3. Mrs Hickey accepted that a reasonable homeowner would be aware of the boundaries of its property; 4. The photographic evidence from 2005 demonstrates that the southern part of 154 Parkes was cleared of vegetation, the log wall was removed and earthworks were undertaken; and 5. The 118B Consent was modified for a second time on 25 November 2005 and that modification resulted in the approval of a revised landscape plan that identified the Gabion Wall for construction on 154 Parkes. This modification was notified, including by letter to the adjoining owners and occupiers as well as signposting. No submissions were made. 1. The Applicants have failed to take any legal action in relation to the Gabion Wall until the commencement of these proceedings in August 2021 (some 16 years later). To this end, the 118B Consent (as modified) is valid unless declared otherwise by the Court: Coalcliff Community Association Inc v Minister for Urban Affairs and Planning (1999) 106 LGERA 243. Further, the Applicants did not commence any action against the developer in trespass or nuisance. Finally, the Applicants have pleaded matters relevant only to the developer who has not been joined as a party to the proceedings for the purpose of discharging the Applicants' onus under s 3(3) of the Encroachment Act; and 2. The imposition of an easement or the requirement to pay compensation is not "just" to the Respondent given that any encroachment of the Gabion Wall would not have been capable of identification by potential purchasers of the townhouses on 118B Parkes. It is well established that development consents are not personal and run with the land: Ryde Municipal Council v Royal Ryde Homes (1970) 19 LGRA 321 at 324. As such, any potential purchaser could have inspected the Council's development application register and this enquiry would have identified that the Gabion Wall was permitted by the 118B Consent (as modified).
11. For those reasons, the Court would decline the relief in the exercise of the discretion conferred by s 3 of the Encroachment Act.

Findings on discretion

1. Having regard to the totality of the evidence I am not satisfied that the Applicants either expressly or impliedly consented to the erection of the Gabion Wall on their land. The evidence of the Applicants was that they did not and I accept this evidence. The evidence of Mr Weber was less compelling as his understanding was based upon the advice of the developer: Tcpt, 2 August 2022, p 112(35-48). However, I do find that the Applicants were either aware or could upon reasonable enquiry have been aware of that fact either at the time of construction of the Gabion Wall or in the intervening period since its construction. I make this finding on the basis of the evidence that: 1. The Applicants were aware that their land extended to the toe of the slope. A timber fence and landscaping were constructed above the toe of the slope by the developer and would have been visible from within the Applicants' land without difficulty; 2. The works-as-executed survey, the geotechnical investigation report and the Architectural plans prepared for the Applicants indicated that the lot extended to the boundary with an intervening Koppers log retaining wall; and 3. The removal of the Koppers log retaining wall could have been ascertained with little investigation and inconvenience to the Applicants and would have disclosed at least to an observer with a passing interest that works were being carried out on the Applicants' land.
2. I further find that the Gabion Wall, whilst providing some purpose to the Respondent by way of ensuring the stability of the upslope land thereby retaining their land (and particularly the driveway and vehicle access) free from upslope slip, does provide amenity benefits to the Applicants. The Gabion Wall operates to retain the Applicants' land where it has the steepest slope thereby levelling and making useable land that would otherwise be of little useability. The current purpose of the Gabion Wall is primarily of benefit to the Applicants as it retains the fill behind it thereby ensuring stability of their land.
3. I find that the Respondent was not the person that constructed the Gabion Wall, nor would it have been able to reasonably ascertain that the Gabion Wall may have been constructed without the lawful authority of the Applicants.
4. I further find that the period of time since the construction of the Gabion Wall and the bringing of these proceedings is a matter relevant to the exercise of my discretion. The passing of some 17 years with no complaint as to the Gabion Wall does indicate some tacit acceptance of its presence. As stated above, I do not accept that the Applicants were or should have remained ignorant that the Gabion Wall was constructed on their land - simple visual cues such as the loss of the Koppers logs, the clearing of the vegetation (lantana) from the slope, the erection of a timber fence and landscaping were all matters that should have and would have alerted a reasonable person to the fact that work may have been being undertaken within their lot boundary. Despite such activities the Applicants suggest that they made no enquiries or undertook visual examination. This lack of investigation in the face of clear and present activity and the subsequent passing of time speaks against the exercise of a discretion that would impose an obligation on another landowner that did not itself construct the Gabion Wall.
5. For each of those reasons, if the Applicants were entitled to the relief that they sought I would have declined to make the orders in the exercise of the discretion provided for in s 3 of the Encroachment Act.

Costs

1. Each party requested that, in light of the issues raised in the proceedings, it would be appropriate for the parties to consider my reasons before addressing on costs. In addition, there had been offers made as to costs that may become relevant to any cost application depending upon the outcome of the proceedings. For those reasons, I accepted that it was appropriate that I reserve the question of the costs of the proceedings.

Conclusion and orders

1. For the reasons outlined herein, I find that the Applicants are the Encroaching Owner for the purposes of the Encroachment of Building Act 1922 (NSW). The relief sought in the proceedings is not available to an encroaching owner and, accordingly, the proceedings are dismissed.
2. The Court orders that: 1. The Application filed on 5 August 2021 and as amended by leave granted on 1 August 2022 is dismissed; 2. Costs of the proceedings are reserved; and 3. The matter is listed for mention at 9.15am via audio-visual link on Friday, 9 December 2022 for the making of directions and the fixing of a hearing on the issue of costs.
3. Should the parties reach agreement on an appropriate costs order prior to the mention date in order (3) liberty is granted to the parties to approach my Associate with consent orders for the purpose of such orders being made in chambers, in which case the proceedings will be concluded, the mention date will be vacated, and the exhibits will be returned. Annexure A (250855, pdf)

Amendments 08 March 2023 - amended counsel. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 08 March 2023